Radically Inept
Thursday, April 01, 2004
  And yet, the Tyco trial looks to be on the way to a mistrial

From TCS: Tech Central Station - Where Free Markets Meet Technology comes this: TCS: Tech Central Station - Jamie Olis's Tragedy, And Ours, by James K. Glassman:
"On Thursday, a 38-year-old Korean immigrant named Jamie Olis, with a wife and a six-month-old daughter, was sentenced to 24 years in prison for his role in a complex scheme to hide the difficulties of the company where he worked as a mid-level executive.

It was a brutal punishment for a relatively minor crime. The Associated Press, noting that Olis reaped no personal gain, called the sentence 'jaw-dropping.' Since there is no parole in federal cases, he will have to serve at least 20 years.

Olis helped concoct Project Alpha, which inflated Dynegy's cash flow in 2001. According to a Wall Street Journal story in 2002, the scheme relied on corporate heavyweights, including Citigroup, which provided a $300 million loan, and the once-respected and now-defunct accounting firm Arthur Andersen, which gave its official blessing.

The sentence -- the result of a recent stiffening of federal guidelines -- was out of all proportion. By comparison, the median term for murder is 13 years; for drug trafficking, four years; sexual abuse, three years."
And, up until this paragraph, I was sort with the argument, but the next paragraph:
The Olis sentence is just the latest manifestation of the hysterical reaction of politicians to the corporate scandals that broke in the fall of 2001. Olis is a tragic victim, but millions of Americans, many of them without jobs, are also suffering as the U.S. economy struggles under the weight of poorly conceived new rules -- with more on the way.
And he lost me. In fact, I had to re-read it before I realized the whole article was a set up. Feel sorry for the poor guy who's dad left him and his mother. He grows up poor but makes good. All is well until he gets involved in a minor corporate conspiracy to defraud shareholders. Excuse me? He violated his fiduciary responsibilities, got caught, and now I'm supposed to have sympathy for the guy? You know, I don't think so. Well, and am I to believe this is the only time he has done this. If so, based on what? Let's look at a few more sources before we pass final judgment.

[Inserted April 4th: I should have pointed the reader's back to the title of Glassman's article: Jamie Olis's Tragedy, And Ours. Wow. Our tradegy?]

Gene S. Foster, Jamie Olis and Helen C. Sharkey: Lit. Rel. No. 18188 / June 12, 2003:
"U.S. Securities and Exchange Commission
Litigation Release No. 18188 / June 12, 2003

Accounting and Auditing Enforcement Release No. 1800 / June 12, 2003
Securities and Exchange Commission v. Gene S. Foster, Jamie Olis and Helen C. Sharkey, Civil Action No.H-03-2044, United States District Court for the Southern District of Texas, Houston Division (June 12, 2003).

On June 12, 2003, the Commission filed an action in United States District Court in Houston charging three former employees of Dynegy Inc. with fraud in connection with Project Alpha ('Alpha'), a structured financing transaction. Alpha was the subject of a settled cease-and-desist order issued by the Commission in September 2002; in the order, the Commission found that Dynegy violated the antifraud, reporting, books and records and internal controls provisions of the federal securities laws, by reflecting Alpha's impact on its financial statements in the form of $300 million in operating cash flow and $79 million in net income. In re Dynegy Inc., Exchange Act Release No. 34-46537 (September 24, 2002). The Commission found in its order that the Alpha-derived funds were actually loan proceeds, representing, therefore, cash flow from financing activities, not operations, and that the Alpha-derived tax benefit was invalid. In settling the Commission's action, Dynegy also paid a $3 million civil penalty."
Well, that's legalize, but not really all that much help, so let's look a little further.Former Dynegy Inc. tax executive Jamie Olis sentenced - Mar. 25, 2004:
"The judge said he was required to give Olis a sentence of between 24 and 30 years, five years shy of the maximum, based on the massive losses Dynegy shareholders suffered as a result of Project Alpha's repercussions.

Olis, who was already choked up as he stood before the judge, had no visible reaction to the sentence, which read in a courtroom filled to capacity with his family, supporters and ex-Dynegy colleagues.

New laws enacted last year in response to a wave of corporate chicanery and corporate fraud laws passed in 2001 stiffened the penalty range for white collar crimes, putting them equal with offenses like bank robbery.

Michael Shelby, U.S. Attorney for the Southern District of Texas said Olis' harsh punishment was deserved because thousands of investors lost their savings over Project Alpha."
A slightly different picture, but wait, lets look a little further down:
"Dynegy's stock lost more than half its value on April 26, 2002, the day after the Houston company disclosed a U.S. Securities and Exchange Commission investigation into Alpha.

It also had to reclassify the $300 million as debt, pay the SEC a $3 million fine and restate its 2001 earnings downward by 12 percent. The total losses to investors were in the billions.

Two other Dynegy employees, Helen Sharkey and Gene Shannon Foster, Olis' boss, each pleaded guilty to conspiracy to commit securities fraud and agreed to cooperate with prosecutors. Lake is due to sentence both on Aug. 19, and each faces a maximum of five years in prison."
Wow, now he looks like a thief who wasn't bright enough to confess before the state went to the expense of a trial. Did ya'll catch that part about billions in losses to investors? [Here's a nice sympathetic photo of the criminal and his wife and daughter: http://a1112.g.akamai.net/7/1112/492/03312000/news.lycos.com/news/ot_getImage.asp?op=img&id=571790]

You know, this crime took place in Texas, why couldn't we convict him under state law, and then fry his sob story ass. Bet you executives would think a little more about those fantasy classes they had in business school called business ethics, if ethical violations included hanging. 
Comments: Post a Comment
Any subsidiaries, affiliates, officers, agents, or employees of any site employing compulsory user registration mechanisms are not authorized to access the content or services of this site.

02/15/2004 - 02/22/2004 / 02/22/2004 - 02/29/2004 / 03/07/2004 - 03/14/2004 / 03/14/2004 - 03/21/2004 / 03/21/2004 - 03/28/2004 / 03/28/2004 - 04/04/2004 / 04/04/2004 - 04/11/2004 / 04/11/2004 - 04/18/2004 / 04/18/2004 - 04/25/2004 / 04/25/2004 - 05/02/2004 / 05/02/2004 - 05/09/2004 / 05/09/2004 - 05/16/2004 / 05/16/2004 - 05/23/2004 / 05/23/2004 - 05/30/2004 / 05/30/2004 - 06/06/2004 / 06/06/2004 - 06/13/2004 / 06/13/2004 - 06/20/2004 / 06/20/2004 - 06/27/2004 / 06/27/2004 - 07/04/2004 / 07/04/2004 - 07/11/2004 / 07/11/2004 - 07/18/2004 / 07/18/2004 - 07/25/2004 / 07/25/2004 - 08/01/2004 / 08/01/2004 - 08/08/2004 / 08/08/2004 - 08/15/2004 / 08/15/2004 - 08/22/2004 / 08/22/2004 - 08/29/2004 / 08/29/2004 - 09/05/2004 / 09/05/2004 - 09/12/2004 / 09/12/2004 - 09/19/2004 / 09/19/2004 - 09/26/2004 / 09/26/2004 - 10/03/2004 / 10/03/2004 - 10/10/2004 / 10/10/2004 - 10/17/2004 / 10/17/2004 - 10/24/2004 / 10/24/2004 - 10/31/2004 / 10/31/2004 - 11/07/2004 / 11/07/2004 - 11/14/2004 / 11/14/2004 - 11/21/2004 / 11/21/2004 - 11/28/2004 / 11/28/2004 - 12/05/2004 / 12/05/2004 - 12/12/2004 / 12/12/2004 - 12/19/2004 / 12/26/2004 - 01/02/2005 / 01/02/2005 - 01/09/2005 / 01/09/2005 - 01/16/2005 / 08/28/2005 - 09/04/2005 / 09/11/2005 - 09/18/2005 /

  • Site Feed

  • Back to Radically Inept Main Page

  • Selected pieces cross posted at:
  • American Samizdat

  • Authors' Bios:
  • Somewhat accurate, no where close to complete
  • Photo
  • Rick Eddy's bio

  • Radically Inept attempts at shorts, and personal vignettes:
  • A Modest Proposal: A Solution to the Problem of Poverty in America
  • Wherein I confess my complete ignorance of 'common knowledge'
  • Learning from Mikey
  • I remember the Army...
  • A memory hole

  • Rick Eddy pieces:
  • Osama's Hair Stylist
  • Speed and Shorty come by for a visit
  • A rant and a Prediction
  • Rick Eddy on NASCAR and 'Bidness'
  • The continuing saga of Rick Eddy on The Temple of Doom:
  • Rick Eddy on the Temple of Doom (Part One)
  • Rick Eddy on the Temple of Doom (Part Two)
  • Rick Eddy on the Temple of Doom (Part Three)
  • Rick Eddy on the Temple of Doom (Part Four)
  • Rick Eddy on the Temple of Doom (Part Five)

  • The Dailys:
  • lies.com
  • MaxSpeak
  • pandagon.net
  • The Blogging of the President: 2004
  • Modulator
  • North Georgia Dogma
  • The Corpus Callosum
  • Drunken Monkey Style Blogging
  • Fafblog! the whole worlds only source for Fafblog.

  • As time permits:
  • Intel Dump
  • Orcinus Fair and Balanced
  • FuturePundit.com
  • Brad DeLong's Semi-Daily Journal a Weblog
  • Marginal Revolution
  • How Appealing
  • Chris C Mooney
  • Kevin Drum
  • Cyborg Democracy
  • Cursor.org
  • Iraq Now
  • butterfliesandwheels.com
  • Atrios
  • Talking Points Memo
  • Roger Ailes
  • The Panda's Thumb
  • corrente
  • WorldChanging: Another World Is Here
  • The Truth Laid Bear
  • Fables of the reconstruction
  • Oliver Willis: Like Kryptonite To Stupid
  • Kieran Healy's Weblog
  • Happy Furry Puppy Story Time with Norbizness
  • TheAgitator.com
  • Paperwight's Fair Shot
  • Lotus - Surviving a Dark Time
  • thoughts on the eve of the apocalypse
  • The River
  • Mind is Moving
  • commonSci
  • dr. menlo: promoting people over profits since 2000
  • Where We're Bound
  • Boing Boing: A Directory of Wonderful Things
  • Public Domain Progress

  • Infrequent, but worthy posters:
  • Rogue Analyst (My other blog)
  • CenterPoint - A Centrist Weblog
  • scratchings
  • Inspector Lohmann

  • Excellent sources of info:
  • Farmers and Consumers Market Bulletin
  • TomDispatch
  • KurzweilAI.net
  • Open Government Information Awareness
  • SPACE.com
  • Agnosticism / Atheism - Skeptical Inquiry, Freethought, & Religious Philosophy
  • Defense and the National Interest
  • Google News
  • TCS: Tech Central Station - Where Free Markets Meet Technology
  • ajeeb, News
  • Corp Watch
  • Center for Strategic & Budgetary Assessments
  • GlobalSecurity.org
  • Moving Ideas: Connecting You To The Progressive Community
  • The Memory Hole [rescuing knowledge, freeing information]
  • The International Campaign for Justice in Bhopal
  • -:| CHINA TODAY |:-
  • Alex Jones' Prison Planet.com: The Earth Is Being Turned Into A Prison Planet
  • Alex Jones Presents Infowars.com to Fight the New World Order --There's a War on For Your Mind
  • THE WAR IN CONTEXT:: Iraq, the War on Terrorism, and the Middle East Conflict - in Critical Perspective

  • Fun and off the beaten path:
  • GHOST TOWN - Chernobyl Pictures - Kidofspeed - Elena
  • Cooperative Extension Service (GA)- Publications
  • The Vaults of Erowid
  • Eyeballing Series

  • What I'm listening to:
  • Radio Paradise - eclectic online rock radio
  • Shameless plug
  • Big Rock Studio Technologies

  • Powered by Blogger

    Weblog Commenting and Trackback by HaloScan.com Site Meter